Abstract. The carbon (C) dynamics of northern peatlands are sensitive to hydrological changes owing to ecohydrological feedbacks. We quantified and evaluated the impact of water level variations in a beaver pond (BP) on the CO2 flux dynamics of an adjacent, raised Sphagnum–shrub-dominated bog in southern Canada. We applied the CoupModel to the Mer Bleue bog, where the hydrological, energy and CO2 fluxes have been measured continuously for over 20 years. The lateral flow of water from the bog to the BP was estimated by the hydraulic gradient between the peatland and the BP's water level and the vertical profile of peat hydraulic conductivity. The model outputs were compared with the measured hydrological components, CO2 flux and energy flux data (1998–2019). CoupModel was able to reproduce the measured data well. The simulation shows that variation in the BP water level (naturally occurring or due to management) influenced the bog net ecosystem exchange (NEE) of CO2. Over 1998–2004, the BP water level was 0.75 to 1.0 m lower than during 2017–2019. Simulated net CO2 uptake was 55 gCm-2yr-1 lower during 1998–2004 compared to 2017–2019 when there was no BP disturbance, which was similar to the differences in measured NEE between those periods. Peatland annual NEE was well correlated with water table depth (WTD) within the bog, and NEE also shows a linear relation with the water level at the BP, with a slope of −120 gCO2-Cm-2yr-1m-1. The current modelling predicts that the bog may switch from CO2 sink to source when the BP water levels drop lower than ∼ 1.7 m below the peat surface at the eddy covariance (EC) tower, located on the bog surface 250 m from the BP. This study highlights the importance of natural and human disturbances to adjacent water bodies in regulating the net CO2 uptake function of northern peatlands.